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tv   Fast Money  CNBC  December 7, 2015 5:00pm-6:01pm EST

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longest expansions we've had. thank you for joining us. mike's piece is on cnbc pro. that does it for us on "closing bell." up next, mandy in for melissa lee. >> "fast money" starts right now. we are overlooking times square. hello, i'm mattie, sitting in for melissa lee. our traders on the desk today are dan nathan, david seaberg, guy adami and a special appearance by the kmoditiys king dennis gartman. and oil hitting near seven year lows. and the one group of energy stocks that could take off after the collapse. plus new rubber maid and jam are hooking up in what could be a $20 million merger. so we have the reporter who broke that story and she will give us the very latest. on top of that, small caps are doing something this month that they haven't done in a long time.
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and it could spell big trouble for stocks. the shocking charts you have to see. but first, we do begin with the story of the day. and that matter, the last year. crude hitting a level it hasn't since 2009. and the last time that we saw a collapse like this in the oil market, stocks followed suit. i'm sure you all remember that. guy adami, do you think this will repeat itself. history does have a habit of doing that. >> everybody is talking about the transitory nature of crude. i think it continues to go lower. we've said that for a long point. at a certain point, to answer your question, i do think it manifested into a broader market. it hasn't yet. i'll say this though, the pain trade in energy continues to be lower. but the pain trade in the broughter market, the s&p is still higher in my opinion. how do you trade crude? we've talked about the refiners for a long time. that has worked. we have to see if they get the product mix. but stay away from the big cap names, exxon, chevron, still too high in valuations at $38 in
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crude. >> but the question is how much lower. and it was not so much long ago that goldman got smirks around the table when they put out the $20 price tag. what do you think, dennis? i think that is achievable right now. >> it is quite achievable. if you look at canadian western, it is down to $12 and $15 depending on where you want to price it. you could get this very ready illy. and we are storing crude. we have filled up the tanks and the salt mines -- the salt domes and probably the tankers. if there is a place, it is the tankers right now. >> what about you, dan? >> i think the focus has to be the u.s. dollar again. we had that selloff last week after the ecb, the dollars filled in a little bit of the gap going forward into the fed meeting in a week and a half or so. i think the dollar is poised to retest the breakout that it wanted to do a couple of weeks
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ago. if the dollar continues higher, oil will continue lower. all of the other stuff is way above my pay grade but the sentiment isn't bad enough yet. and think the way this thing has to turn, at least for near term bottom, you need to see a day like today down, down 10% the next day and then see buyers come in and cover shorts. >> i think the worst price service names, the emps are overvalued and i think rand is a wild card and that will create more supply than the market could consider right now. and look at iran being a wildcard and more than 500,000 barrels a day when sanctions come off, it is closer to 800,000 and i think it will impact the price. >> the saudis, they are making it difficult for everybody at this point. they have to. they are trying to make it difficult for the frackers. but the frackers are making difficult for the frackers. because you have some frackers that could drive -- they have gotten so good at it. if they are drilling and been at
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it for a while, they've driven the cost down to $22, $24 a brarl and they are putting -- barrel and they are putting pressure on other companies. >> what about the borrowing base. they are re-upping that. and the question is when do the companies get pressed out of business. that is when you jump in and buy the equities. right now you can't buy them. still more downside in crude. no question about it. and i think the borrowing base needs to be ripped out of the hands. the ones with the best u.s. assets. that will hold the best u.s. assets in most financial distress, those are the ones where you would make a tremendous amount of money, maybe even own paper. dennis is the expert from that perspective? >> dennis? >> at this point, we used to get it the puke point. somebody is going to puke on their shoes. and that will happen. it will happen in the next three or four weeks. one day the crude oil is down not $2 or $3, maybe down $5 or $6. and at that point you will turn and in the afternoon see stock
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prices trading higher. you won't know the low until you see it. >> are you buying anything in the space on the way down. >> the only thing to make sense, just as a punt, i tried to buy something i had a couple of years ago, the manufacturers of sand that go into fracking. some of the sand suppliers have gone from $85 a share down to $5 a share. it is not a bad punt at $5 a share. am i going to make a huge bet? no. >> before we get to the guest, what about the kinder morgan review, creating a layer of concern and whether or not we might see the other big oil majors like exxon or chevron follow suit. >> i don't think the large companies will cut dividends. they've never done it in the past. so as far as the options market is concerned, there was tons of put buying in marathon. and ete, a massive put-roll in that thing. there is worry -- kinder morgan saw a lot of put activity. this is a capital structure trade at some point. some companies will be forced to
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reorganize and won't be worth a whole heck of a lot. that is a 2016 thing. we'll see dividend cuts and defaults and then reorganization and see some equities go kaput. >> well let's bring in our guest. commodities getting hit hard but ed yardeni said that isn't reason to think a recession is around the corner. he joins us now on "fast" line. could you explain this to us, ed. >> clearly commodities producers went on a binge anticipating a commodities super cycle, mostly because they expected a china super-cycle and they built too much capacity to what the world really needs. so the plunge in commodities prices is more supply and demand driven. the demand has slowed down. but all in all, i think this is actually going to be quite positive for the stock market. because i think the fed is going to realize that the price of oil hasn't stopped falling yet.
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and inflation is still going to be lower. and that argues for maybe one and done on december 16th. and none and done for most of next year for fed rate hikes. >> so if you say it is more of a supply than demand problem, when do you expect eck willib re um coming back into the market. >> commodities markets adjust as the price falls. supply comes down and demand increases. we had an increase in demand for oil. but the supply response is totally bizarre and diseck willib re ating. oil produces have been producing more and that is because they have to make some debt payments and i think they are also trying to drive out weaker competitors. and they may not realize it, but they may be the weak competitors. >> that is exactly right.
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some tripping over their skis of producing or over-producing and driving each other out of business trying to figure out how to make it up. when you talk about a supply issue, per se, are you seeing that slow down to the point where you are comfortable yet or the trajectory of that or is that going to take longer than most people are anticipating? >> on the supply side? >> on the supply side. >> i haven't seen anything. everything i'm reading going the other way. producers, and many of the commodities are scrambling to produce more hoping that somebody else will go out of business. look, what we have here is the bursting of the latest bubble. a commodities super-cycle bubble and usually when a bubble burst, you have a financial crisis or recession, depression and somewhere along the line, central banks come in and try to stop all of that. this time around, knock on wood, we really haven't had the financial crisis. though credit spread is starting to widen pretty significantly over the last year. and that is where the vulnerability lies. because the super cycle expands
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to the capital markets, think they can absorb it. >> okay. ed yardeni, thank you for joining us. founder and president. okay, guys. when do you think we're going to hit bottom? >> not for a while. listen, as long as this evx stays above 40, oil will continue to go lower. the pain trade is down. and we talked about names like freeport macmaran, every time they have made an acquisition they top tick the industry they bought in. painful trade that will continue to get more painful. how do you trade it, three steps down the line. a name up 3%, on a lousy tape, a name we talked about forever on this show, jet blue airlines. >> watch the term structure of the futures market. as long as the front month feature loses rell toif to the back months, that means crude is looking and bidding for storage. as long as that continues to widen, you have to be bearish.
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and when that narrows, and before the market turns around, then be a buyer. but right now, the term structure continues to expand and the caring charge continues to widen. crude continues to bid for storage. it is a bir market. >> a lot of things trying to hit bottom recently. thank you very much to all of you. coming up, rubber maid and jarden in merger talks. we have the reporter who broke that story after the break. and plus apple is dominating the competition but could it be a bad thing for the stock. the traders weigh in. that is up next. and small cap stocks flashing a major warning sign. we have the charts that you need to see later on this hour. much more "fast money" still ahead.
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welcome back to "fast money," everybody. rubber maid and jarden surging late in the day after reports claim the two consumer goods companies are in talks to merge. and that kicks off our top trade. welcome back. with a market cap of more than $20 billion. the "wall street journal" reporter who broke that story is dana mattioli and she's with us on the "fast money" line. she's broken almost every deal this year. congratulations to you and great to have you on. just how far along are the talks
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and do we know who initiated them? >> we don't know how far along the talks are or the exact terms. it is interesting that both companies are really similar in size. so there is always the possibility this could be structured as a merger of equals. or a pure takeover. >> given the doj stance on mega-mergers recently and how sticky it has been, what is the likelihood of this getting done. when you look at the portfolios, there is not a huge amount of overlap. >> jarden makes copy machines and skis. >> and rubber maid makes baby strollers so it doesn't seem like too much of an anti-trust deals like we've seen on other deals. and if products overlap, they could divest them. >> this is david seaberg. not a question but a statement. this looks like a perfect example of mergers of equals where two companies will try to reduce costs and to figure out how to drive revenues going
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forward. i believe that is the ultimate goal now of corporations and ceos that don't want to get left behind and it seems this is a scenario that exists. >> who ends up coming in as the management of this. >> that is the question. >> that is the real question. >> and jarden, do they come in as potentially the lead manager on this deal? >> do you have anything on that subject? >> that is a problem with quote, unquote, merger of equals and there is questions about who run the companies. and egos get involved. we are not hearing of that here but that holds up these type of transactio transactions. >> dana, thank you very much. if you have any more news on the subject or details on how the terms might play out. let us know. let's trade this on the desk, guys. what do you think. >> jarden is a great company. martin franklin has been there for a long time. he is the ceo. i hope it is him for the takeover. they trade around 15 times forward earnings. what is a good comp. i'm not sayer they are dana her.
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they trade around 24 times forward earnings. i think jarden, given this potential deal, should have at least that type of multiple. if you had to buy between newell and jarden, i would pick jah. >> i support management 100%. but like i said before, this is a perfect example of companies that have done a good job managing costs and now they are at the point to figure out a way to bolt on growth. this is a way to do it. i like both companies but i prefer jarden. >> what about you, dan, any thoughts. >> i don't know about newell, but jarden, and the management they have, mr. franklin, he is topnotch. and if it is a merger of equals, will you want to own that. >> and moving on and sticking with deals. keurig green mountain surging as the holding snatches up the company for $13.9 billion. and with the epic move, that is a beaten down stock you are looking at.
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it is down 30% this year. and that got us thinking. what are other beaten-down names that might be good takeover targets. let's go around the horn. starting you with, dan. >> this was a mini bubble in 2014, it was 3-d printing. >> that was hot. >> so 3-d systems was the poster child. with a $10 billion market cap. that market cap is about a billion dollars. they have $150,000 in cash and no debt. $650 million. so it is trading less than 1.5 times sales. this is a cheap company if they could ever actually really deliver on the promise of these products. i think there is a secular shift toward 3-d printing. i think over the next few months stocks like this and strategists are worth a long shot. >> we've all given you a heart attack, we could print one for you in the future. dave? >> we'll keep it in the biotech
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age. blueberg has gone from $200 -- well went from $200 down to $53. downgrades today. i know we'll talk about it earlier. but this stock has $900 million in cash. it is absolutely being dismantled because of the data out of ash. they need more time. we believe it does work out for the sickle cell drug. a lot of pharma needs to bolt on product and this is an opportunity to do so. you could buy it for one of four -- the value of one of four of their essential franchises if you will. >> look at that. absolutely slaughtered today in trade. what about you, guy? >> beaten down stocks. we are trading at 15-year lows. trading lower than we saw in the '09 low i believe. and it is basically saying they will never sell another hot rolled steel item in it their lifetime. which i know is false. i'm not trying to pick a bottom in steel because i think there is pain on the down side. but with the billionon dollar
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market cap, any incremental news will send the stock higher. for someone to take a flier on the steel industry that is beaten down to own the best brend, u.s. steel is the best way to play it. >> news alert on carl icahn and cheniere energy. dom has the latest. >> carl icahn has boosted his stake to near 14% from a prior stake of around 12.7%. this continues to trend since about august. where he has repeatedly upped his stake by smaller amounts into lng, which is the ticker. and you could tell they do liquified natural gas. so cheniere energy right now marginally lower about 222,000 shares. it looks like he has boosted his stake in cheniere to 13.8% from a prior 12.65%. this is around the eighth time he's boosted the stake since
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around august. back over to you. >> thank you very much for that. dom, we'll see more of that. and the vultures cycling around over the carcasses, what do you see about that. >> it is hard to take on carl icahn. but he is buying something in a protracted downturn. eventually it will get stronger. but until you see it get stronger and see the cold weather come in, sustainable, it will be a difficult trade. you have natural gas prices -- you have natural gas prices trading at one-third of what they were a mere three years ago. and they don't look like they will move. there is plenty of drilling going on. they are continuing to drill with it. >> i totally agree with that statement. and look at the investments he's made over the past couple of years. this may be a good investment at some point in time. there is more downside here i think. and at some point it looks -- >> and the cost of the structures are aft ron ommic. >> exactly. >> and the weather will not help
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natural gas. >> and i would just add about cheniere. it bounced off $40 today. that is a big support level going back maybe a couple of years right now. and this is a different one than the transocean and the other names that he owns in the energy space that seem like distressed equity. yes, it is in a down trend but it is also up from $10 a couple of years ago. so when you think about this one, this is probably not one of the ones you want to jump in because he mildly raised his stake. >> okay. still ahead. stocks taking a beating today. but by the close, there is one part of the market that could be telling the real story about what will happen next. the shocking chart you need to see later on this hour. you're watching cnbc, first in business worldwide. and here is a sneak peek of what else is coming up on fast. >> that is what biotech is doing. but traders are betting that
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some names are due for a bounce. we'll tell you the stocks. plus, it is a tale of the tasty tape. mcdonald's shares hitting all-time highs as chipolte falls to the mat. but are investors missing a crucial part of the story? we'll explain when "fast money" return. can you help santa with a new data plan? sure thing... uh right now you can get 15 gigs of data for the price of 10. that's five extra gigs for the same price. looks like someone just made it to the top of the nice list. in that case, i want a new bicycle, a bike helmet, a basketball, a stuffed animal that talks when you squeeze it. and... yes, yes. i got your letter. we're good. oh. okay i was just making sure. get 15 gigs for the price of 10 now at at&t.
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welcome back to "fast money," everybody. well now to a tale of two fast food stocks. mcdonald's shares hitting an all-time high today while the fallout from the chipolte e-coli outbreak went to the lowest level since may of 2014. so let's trade some of the fast food stocks. it is incredible, how the fortunes could change. it wasn't so long ago that mcdonald's was struggling and did a re -- revamp of the menu and where do we go from here. >> i don't think mcdonald has done anything on the foot front. >> what do you mean? they have streamlined breakfast. >> when you think about it, the menu and the food is still bad quality and not that something particularly like. and when you think about chipolte, people like the quality. it was a high quality.
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>> food with integrity, locally sourced. >> i wouldn't touch it with a ten foot pole. to me it will go through 500 and keep on going. mcdonald's is going to be the beneficiary of seeing a large competitor for so long, they used to own it, falling by the wayside. so to me, mcdonald's there is a lot going on. >> the menu change, i don't think you see the same consumer going over to chipolte in that way as aggressive as mcdonald's vice verse. >> all prices made at the margin, are 3% of the chipolte people going to mcdonald's? probably. are 15 or 20% go? no. but 3%. maybe. >> and it is now back to $116 a share. now they are buying back stock. where were they at $90. i don't like mcdonald's at these levels. i think the stock will not go
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much higher or struggle until they could prove and put up meaningful sales. >> with mcdonald's at this level would you be willing to take the risk? >> chipolte was -- when we heart about the e-coli break at 32 some odd stores we did an analysis that thought it was a 10 cents hit to earnings if all of the stores strayed close. i said at $600 it should be a buy but it should be a trade. it is more contagious. we downgraded it today. stay away from the stock until we get a much more clear visibility. >> mr. vision of health over here. >> i love chipolte. the problem is, boston college headline today, eight of the college basketball guys went down with e-coli, attributing it to cmg. but dan mentioned, it did bounce today and it bounced hard on what was three times normal volume. last week we talked at $500-ish was a level and we got close. so how do you trade the stock in
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i'm in agreement that i think this could create one more time because the hits will keep on coming. but if you are so inclined you could own it against today's low which was $550. >> and they have tightened up the food protocol. >> one would hope. >> big blow for the locally sourced producers? >> it never made sense to me. people have to understand what organic means. it means you are putting manure on lettuce. >> so are you saying it is a blow for the entire organic movement? >> it should be. >> i like the word movement in that concept. >> i won't touch that with a ten foot pole. >> maybe it was. still ahead, it is a biotech blood bath. a number of stocks getting hit. at one of the biggest biotech conferences of the year. we'll take you inside after the break. and plus only 17 days until christmas. the holiday shopping season is in full swing. get out there, guys if you haven't already. the former ceo of urban outfitters unveiling the secret to success and the retail names that may make the grade.
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that is right here on fast.
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welcome back to "fast money." a down day on the street to start the week. stocks all red across the board. the s&p 500 falling 100%. the dow was down nearly 200 points at the low closing down by 117 points. energy falling 4% as crude oil plunged to a seven-year low. well here is what is coming up in the second half of the show. a modern day david versus goliath. one mayor in new jersey saying amazon is reeking havoc on his small town even though it is the largest employer. the man who is taking on that resale giant on the first cnbc interview. plus airline stocks emerging as some of the biggest winners and how high they see it going. but first let's start with biotech. because one of the biggest medical conferences is underway and already a number of stocks have tanked.
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and mean tanked. biotech reporter meg tirrell is live from orlando, florida, with the key themes from the meeting. what are you hearing, meg? >> reporter: the main theme is that expectations coming into the conference were just extraordinarily high. and some of the data aren't really meeting expectations. let's start with companies working on drugs for sickle cell. those are blueberg and global blood therapeutics. blue bird down 38% and global blood down 26%. we sat down with the ceo of blue bird and talked with him about why they are calling these data mixed. take a listen. >> if you think about it from a patient perspective, and you look at the data and taking the patients from a situation where they have a shortened life span to potentially having a normal life span, i'm not sure i call those results mixed. >> so a lot of data also coming at this conference in blood cancer, specifically leukemia and other stocks and
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immunotherapy like juno and cellect is. we talked about this stock reaction and here is what was said. >> the market reaction is very difficult for me. there are things i don't understand and the current reaction, i think the market is oversensitive. always waiting for things that are extraordinary. this is a huge advancement for the medicine in general. >> so there is a lot of excitement about the therapies being talked about here, but the main theme that you are sensing is that expectations were unrealistically high. and when i'm hearing is that folks are saying biotech investors after the year we've had with all of the volatility are just exhausted. and this is really re-setting expectations heading into 2016, mandy. >> thank you for clearing that up. meg tirrell live in orlando. let's trade this, guys. the key thing that i took as a takeaway is the expectations were too high. we've seen this over and over again with biotech.
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>> so what has manifested itself into stock. kite pharma. kite is the symbol. over the summer we said there is a good chance it retests at the levels from january and imperative it close above 90. well guess what, we ran up to the $90 level and failed. here is the good news. the stock went from $50 to $90. today's close puts us at a 50% correction of the entire move. yes, the valuations are ridiculous. this is not a company that makes money yet. but the technology works. and it has a 22% short interest. so if you are looking for an entry point, you got it today. >> and are expectations ahead of them. and that is the case. and blue bird traded from where it ipoed around $20 a share to almost $200 a share f. you are a manager and you have losses on your books, this is a name you will sell. shoot first and ask questions later. and so i look at the name and don't think it was the
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skpepgtations that -- expectations got ahead of them, i think we are in a spooked sector right now. and going into the end of the year, a fund manager will do whatever they could to protect -- or mitigate the losses they have. we have jp morgan coming out, the first two weeks of january, that could be interesting. because the valuation of some of the stocks, small and mid cap names have been crushed so much, what will we see in potential acquisition discussions. that could be the real interesting thing within biotech. we've seen a little bit of it. i think a lot more given the valuation pullback. >> are you thinking of any names you are thinking. >> no. just in case we have a banking relationship. there are high-quality potential assets that are potentially could be taken out. >> that seems like a 2014-2015 story. you mentioned the small caps. they were eye huge beneficiary of the zerb environment. they needed to be inquisitive
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and gain anywhere they could gain pipeline. so to me, i think you want to avoid biotech. not the large cap but the smaller caps ones that are in a massive down trend. as we head into a presidential election year, i think price is a huge, huge issue here. i think guys are going to take their foot off the pedal for a little bit and see how that shapes out. so i suspect that the merge -- the urge to merge is going to slow down a little bit. but if you want to go into a place and i've been talking about the name since the deal was announced, pfizer and allergan. i think the stock works, no matter whether that deal happens or not. i know there is concern about the inversion. its is a cheap stock. >> i think the deals pickup big time. i think that will save the space. and the m&a could happen as early as january and that will save biotech in my opinion. >> what is interesting is that health care is the second largest sector waiting in the small cap russel 2,000 index which could tell the real story about where the markets overall
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are headed. carter worth is breaking it down with us at the smart board and nifty pen as well. carter? show us the charts. >> here is the board. right. i think the issue is this -- it is almost a foregone conclusion you get a year end rally. it is like a birth right in america. that is just not the case. i want to set this up with this. here is the russell 2,000. this is not random. we are here. and we even slipped from this. but this is what we've done over one year and 11 months. no results. and if you look at it as though it were a fund, the max gain you ever got, 11%, a draw down of 17, these are not desirable risk reward. and unchanged on two-year basis. and then i want to talk about the month of december. the statistics are for the month of december. the russell 2,000 outperformed the s&p in 24 of the past 36 years in december. what is happening this december? it is exactly the opposite. the russell 2,000 is down considerably more. and with today's recovery in the
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s&p, this spread even widened. s&p is now up slightly on the year. so things that are supposed to be, don't have to be. let's look at three charts and i'm done. this recovery in the russell was still a period of underperformance over the last four to five months relative to large cap stocks. so a dubious recovery at best. and then the long-term chart from the '09 low, no trend line. trend line. there is every possibility that we revisit trend. and that would imply about 6.5 to 7% from where we are. perfectly reasonable give-back. >> thank you for the illustrations there. let's trade this. >> thought for work. love carter braxton. very attractive man. i also happen to agree with him. the russell does seem to be rolling over. we had mike kuo on a few weeks ago talking about a huge put position with the expectations that it would collapse. you have that and the transport
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seemingly rolling over again. and it has not meant anything for the broader market unless you look at august and september. i think at a certain point though, it absolutely will. but i'm totally with carter on his retracement. >> when you say at a certain point. what are you waiting for? >> if we break down the trend line that carter just drew that i had to guess comes around 108. >> any one else feel that the russell 2 k is spilling bad over all. >> i like the russell. and i'll tell you why. i think the dollar strength, the domestic companies not necessarily impacted by the currency headwinds and the consumer spending aspect of it. you have a lot of money coming on the table. people saving tremendous amount of money from oil being so low. >> oil has been low for a long time and we haven't seen it benefit the consumer. so when i look at the russell, i see exactly what carter sees. if you want to hype this trade that russell underperformance all year long, it has probably been a losing trade most of the time, except for right now.
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it is down 10% from the all-time highs that it made in the spring and could not keep pace with the large cap. so what it is telling me is they don't care about savings at the pump and whatever. it is small cap and biotech that is weighing on it, and energy weighing on it. and the small companies that don't have the dollar headwinds, they are more levered. so we see stress in the credit markets. this is where any problems will happen in equity land first. >> the question is these are the names they could push around. the fund managers that are underperforming, these are the names they could push around because they are more ill-liquid names. this is where the chase does occur into year end if there is one this year. >> and this is making assumptions about the strong dollar continuing. it might be a sell. >> it is not. >> let me see what mr. gartman has to say. today is a great example. it is a safe haven trade when things are going haywire. >> absolutely. i think we're at the fifth inning in a nine inning ball game. all investment is a study of
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somebody's propensity to do something and the propensity to make it's way to the united states is enormous and the dollar will still get a lot higher. >> king dollar keeping its crown. we have a market alert on chipolte from dom chu. >> bare with me for a second because we know this is a developing story after hours. we'll point out chipolte mexican grill shares are down 4% in the after hours on 128,000 shares worth of volume. we're going to tell what you we know and don't know right now. what we do know from the massachusetts department of puic health is that they can confirm about 20-plus students have had some kind of a report of gastrointestinal illness involving boston college students. again, while we cannot confirm a cause of the illness at this time, we are coordinating with boston health officials to determine what the cause could be. so that is the massachusetts department of public health. meanwhile, you have chipolte who says they are still trying to figure out or trying to report
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or try to gather their own facts on what is happening with this restaurant or the one in massachusetts. we do know from our sister affiliate necn, a television station in the boston area, that the cleveland circle chipolte is now closed. so they have sent a reporter out there and they could confirm it is closed. we could also tell you that right now from a bc statement, they do say that they've confirmed several students and student athletes having graft row intestinal symptoms. but the big deal is they are still trying to figure out if it is linked to the ongoing e-coli investigation. mandy, it is important here, there is no confirmation as of yet in massachusetts that this is in any way, shape or form, e-coli. there are symptoms that mirror them but the department of health has yet to go and categorize this as e-coli. that is what we know and don't know at this time. back over to you guys. we'll keep you posted. >> you are right. we have to be careful about jumping to conclusions with this. but at the same time it must be
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frustrated for chipolte that still do not know what the cause of this is, what the key ingredient is. >> every friday after thanksgiving, i put out of a list of my favorite rules of trading. and there is never just one cockroach. you knew this will happen again. and it will happen again until it stops. yes, we don't know for certain that what happened in boston was e-coli but then again we didn't call them terrorists until we found out they were muslim radicals. >> and we talk about chipolte versus mcdonald's. mcdonald's sales are down 3%. they were down $3 billion. and in that same time frame chipolte sales have risen by a quarter billion dollars. and it is not too different than what just happened with vbl volkswagen. what did we saw out of ford and gm? we saw an uptick. i think chipolte is a no-touch. there are too much reports that
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we are hearing and after the fact there will be a period of time where we have to see what shake-out is. >> who is the biggest beneficiary of chipolte's woes? >> taco bell. >> kwud owna. >> it doesn't matter. if you walk by a chipolte, are you going to walk in? that is the position they find themselves in. so whether or not it is due to chipolte or not, it is not the point. it is the point that -- >> could they isolate the issue. >> that is a long until. >> after audi had problems 20 years ago, how long did it take for them to overcome that bad publicity? it took a decade. >> look at the taco bell scenario. how long did it take them to discover it. and now it is more sophistication and monitoring, they could come out and have the controls to identify the issue quickly. i think it is a scary scenario and will keep people away for a long period of time. >> on the side lines. still ahead, one airline is up 11% this month alone and some
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traders think it is gearing up for a big move higher. that is coming up. now more than ever america's electricity comes from cleaner- burning natural gas. and no one produces more of it than exxonmobil. helping dramatically reduce u.s. emissions. because turning on the lights... isn't as simple as just flipping a switch. energy lives here.
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welcome back to "fast money." we now have an update on the chipolte situation. they have issued a statement regarding what is happening in boston right now. safety and well being of our
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customers always the highest priority. the restaurant in cleveland circumstance until boston is temporarily closed while officials work with local health to investigate a number of illnesses among boston college students. we do not have information to suggest it is related to previous e-coli incidents. there are no confirmed cases connected to e-coli in chipolte in massachusetts. this is the latest news about the possible illnesses that may mirror some symptoms of e-coli. but no confirmed link from the department of health in massachusetts but this is e-coli but that is the latest statement. back over to you guys. >> thank you, dom. switching gears. the mayor of a small town near princeton, new jersey is threatening to sue the online retail giant amazon claiming that the presence of the warehouse is causing unmanageable traffic in his small rural town. he asked them to change the operating hours.
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today amazon implemented a plan to do just that. so is it working. joining us now the robbinsville, new jersey, mayor, mayor freed. thank you for joining us. they said they have done a number of things to alleviate congestion and other measures an they do admit that more needs to be done. what more would you like to see? >> well, i think at this point we're going to need to put in some infrastructure and sitting down with amazon over the next few weeks and we could make sure we could provide the proper road improvements we need to handle which is now what they are saying the busiest amazon warehouse on the planet. >> if the traffic resumes, if you don't feel satisfied with the progress, would you be pushing to close the distribution center, keeping in mind all of the jobs that it provides, the tax that it provides your town as well? >> look, the last thing that we want to do is shut down a warehouse before christmas. especially a warehouse of this
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magnitude. but ultimately my job is to make sure that we keep all of the residents and the employees of amazon safe. so public safety is our first priority. while we don't want to take that step if we don't have to. we are clearly going to do everything we could to make sure that doesn't happen. >> could i ask a question. this is david seaberg. this is a ploy to squeeze amazon with dollars for the town. they are creating jobs in the town for the people that voted for you. are they really complaining in a way that is massive? or is this just a way to go after them and figure zaub is going -- amazon is going to give us cash. they don't want to build a new distribution center and they are not going to move out? >> not at all. amazon came to us with a traffic study that showed they could handle 2,000 trips at peak. 1,000 during the morning. they added four times that in the morning and twice that in the afternoon. and the park was not built for that kind of infrastructure and that kind of traffic. as it is right now, they have to have 40 flag men inside of the parking lot to keep the traffic
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moving. we have five police officers working two shifts three hours a day. so we have to make some infrastructure improvements. and it is basically significantly more than they told us it would be. and we have other fortune 500 companies in the park whose employees are having difficult times getting in and out of their driveways so they could come to work. >> i hope you could come to an arrangement that is ammicable. thank you very much, mayor. back here on the desk, let's trade this. this is the big kahuna. they are now operating in amazon's world. >> it is their world. netflix is one of them. it is also amazon's world. i get valuation. people come back to us all of the time, how could you like amazon at this valuation. they have the levers they could pull to make themselves money to look and be profitable. margins continue to improve. i think the stock goes higher. airline stocks also going higher today. and some traders are betting that the rally in one name could be just getting started. that is all coming up. your watching "fast money" on cnbc, first in business
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welcome back. delta shares rallying more than 4% today. and one trader bet more than $3 million that the good times could continue for the airline giant.
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dan, yesterday's "options action." danny boy. >> so call volume was four times average daily volume. delta got within 1% of the all-time highs made in the year here. and one trade large in size. it was a roll up and out. so when it was 51.5, a trader sold 22,000 of the december this week expiration proceeds and used the money to buy the december next week 52.5 calls for 77 cents. the calls break even at 53.27. it is up 3.5%. and here is the deal. we have a one year chart. that is a break-out. like i said, to new all-time highs. that is a lot of premium for a big breakout. targeting the fed rate increase and continuing lower lows in crude oil. >> it is incredible how the fed will hike, eruptions in the market if they doesn't. for more options chaks, check it out at 5:30 eastern on friday.
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still ahead, more "fast money" coming up. e stuff, what are you working on? let me show you. okay. our thinkorswim trading platform aggregates all the options data you need in one place that lets you visualize that information for any options series. okay, cool. hang on a second. you can even see the anticipated range of a stock expecting earnings. impressive... what's up, tim? for all the confidence you need. td ameritrade. you got this. when you do business everywhere, the challenges of keeping everyone working together can quickly become the only thing you think about. that's where at&t can help. at&t has the tools and the network you need, to make working as one easier than ever. virtually anywhere. leaving you free to focus on what matters most.
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time for the final trade. around the horn. dan. >> triple d. i'm kicking the tires. >> dave. >> united airlines, i'm a buyer. >> nat, i want to buy tankers. >> mandy, thanks for being here. a lot of fun, always. jet blue, breaking out. >> catch "fast money" tomorrow,
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and midnig"mad money" with jim begins right now. my mission is simple. to make you money. i am here to level the playing field for all investors. there's also work and i promise to help you find it. "mad money" starts now. and i am cramer. welcome to mad money and i am trying to not lose your money. my job is not to entertain but teach and educate. you can call me or tweet me at jim cramer. are fossil fuels the next


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